While institutions invested in Wistron NeWeb Corporation (TWSE:6285) benefited from last week's 5.4% gain, retail investors stood to gain the most

Key Insights

• Significant control over Wistron NeWeb by retail investors implies that the general public has more power to influence management and governance-related decisions
• 50% of the business is held by the top 19 shareholders
• Institutional ownership in Wistron NeWeb is 27%

A look at the shareholders of Wistron NeWeb Corporation (TWSE:6285) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 47% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While retail investors were the group that benefitted the most from last week’s NT$3.9b market cap gain, institutions too had a 27% share in those profits.

Let's delve deeper into each type of owner of Wistron NeWeb, beginning with the chart below.

Check out our latest analysis for Wistron NeWeb

What Does The Institutional Ownership Tell Us About Wistron NeWeb?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Wistron NeWeb already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Wistron NeWeb, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Wistron NeWeb. Looking at our data, we can see that the largest shareholder is Wistron Corporation with 20% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.9% and 2.6%, of the shares outstanding, respectively. Furthermore, CEO Jeffrey Gau is the owner of 0.7% of the company's shares.

After doing some more digging, we found that the top 19 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Wistron NeWeb

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

We can report that insiders do own shares in Wistron NeWeb Corporation. The insiders have a meaningful stake worth NT$2.5b. Most would see this as a real positive. If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 47% stake in Wistron NeWeb. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 3.7%, of the Wistron NeWeb stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

We can see that public companies hold 20% of the Wistron NeWeb shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For instance, we've identified 2 warning signs for Wistron NeWeb that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.